Lipstick ceases to be an economic indicator
In the early 2000s, the founder of Estee Lauder, Leonard Lauder, suggested the use of lipstick as an indicator of the situation on the world market. However, almost 20 years after this, the analysts state that this indicator loses its relevance.
Market researchers say that the lipstick is no longer a barometer of consumer demand, as cosmetic products lose their value in a growing market. In the early 21st century, the market was typical that in times of economic downturns, shoppers limited their spending on expensive consumer goods – clothes, household appliances, but sales of decorative cosmetics and lipstick in particular, increased significantly – it just said Mr. Lauder.
But today, market dynamics have changed. According to marketing research company Mintel, during the global economic crisis, starting in 2008, sales of lip products actually fell by almost 3%, which in turn was to undermine the original thesis of Lauder.
However, the term “the lipstick effect” continues to be called the economic indicator, for example, the CEO of French cosmetic giant L’oreal used this week this phrase to explain the growth of sales in China.
According to the forecast of the company TechSci Research, the market value of the segment lipstick by 2023 will amount to $ 17 billion. It is also believed that other cosmetic products diminish the importance of sales of lipstick, because the lip make up only a small part of the market of decorative cosmetics.
In addition, in the 2010s, many in the media have said that the growing popularity of nail Polish and the emergence of different types of nail polishes allow this product to compete with the lipstick as the main affordable pleasure for women during the economic crisis, which allows some experts to speak about “index of nail Polish”.
In any case, Mintel a recent analysis showed that innovations in the market hold cosmetics sales afloat, even when economy is turbulent. Customers “can try the product with lower price, and then, when they have more income to buy more expensive goods,” said Alison heiter, an analyst at Mintel.
According to Euromonitor, the sales volume in the market of beauty industry this year will exceed $ 11 million, and the global it will cost $ 76 million in 2019.
